SouthState : 4th Quarter 2021 Earnings Presentation

Earnings Call 4Q 2021

Tuesday, January 25, 2022

D I S C L A I M E R

Statements included in this communication, which are not historical in nat ure are intended t o be, and are hereby identifie d as, forward-looking statements f or purposes of the safe harbor provided by Section 27A of t he Securities A ct of 1933 a nd Sect ion 21E of the Securit ies Exchange A ct of 1934. Forward-looking statements are based on, am ong other t hings, management 's beliefs, assumpt ions, current expe ctations, estimates a nd proje ctions a bout the financial services indust ry, the economy and S out hStat e. Words and phrases such as "may, " "approximately," "continue," "should, " "expects, " "projects," "anticipates, " "is likely," "look ahea d," "look forward, " "believes, " "will," "intends," "est imates," "st rategy, " "plan, " "could, " "potent ial," "poss ible " a nd variations of s uch words a nd s imila r expressions are intende d to ident ify such forward-looking statements. SouthState cautions readers that f orward-looking statements are subject to ce rtain risks, uncerta inties and assumpt ions that are diff icult to predict wit h regard to, am ong ot her things, t iming, extent, likelihood and degree of occurrence, which could cause a ctual results t o differ materially from ant icipated results. Such ris ks, uncertainties and assumptions, include, among othe rs, the follow ing: (1) economic downturn ris k, potentially result ing in deterioration in the cre dit markets, greater than expe cted noninterest expenses, excessive loan losses and other ne gative conseque nces, which risks could be exace rbated by pote ntial continued ne gative econom ic deve lopments result ing from t he Covid19 pandem ic, or from federal s pending cuts and/or one or more federal budget-relate d im passes or actions; (2) interest rate ris k primarily resulting from the low interest rate environme nt, potent ially ris ing inte rest rates, and their im pact on the Bank's earnings, including from the correspondent and m ortga ge divisions, hous ing dema nd, the market va lue of the bank's loan and securit ies portf olios, and the ma rket va lue of S outhS tate's equit y; (3) ris ks related to the merger and integration of S outhS tate and CSFL including, am ong others, (i) t he risk that the cost savings and any revenue synergies from the merger may not be f ully realized or ma y take longer than anticipated t o be realized, (ii) t he ris k that the integrat ion of each pa rty's operat ions will be materially dela yed or w ill be m ore costly or difficult than expected or that the parties are otherwise unable t o successfully integrate each part y's businesses into the ot her's businesses, (iii) the amount of the costs, fees, expe nses and charges re lated t o the merger, (iv) reputational risk and the reaction of each compa ny's customers, suppliers, employees or other business partners to the merger, (4) risks relate d to t he merger and integration of S out hState and At lantic Capital including, among ot hers, (i) the ris k that t he cost savings a nd any revenue synergies from the merger may not be fully realize d or ma y take longer than ant icipated to be realized, ( ii) disrupt ion to the part ies' businesses as a res ult of the announcement and pendency of the merger, (iii) t he occurrence of any e vent, change or other circumstances that could give rise to the termination of t he merger agreement, (iv) the risk that the integrat ion of each party's operat ions will be materially dela yed or will be more costly or difficult than expected or that the part ies are othe rwise unable to successfully integrate each party's businesses int o t he other's businesses, ( v) t he amount of the costs, fees, expenses and charges related t o the merger, ( vi) the abilit y by each of S out hState and Atlant ic Capita l to obtain re quired governmental approvals of the merger (and the risk that such approvals may result in the im pos ition of conditions that could adversely affect the combined company or the e xpecte d benefits of the t ransaction), (vii) reputat ional risk and t he react ion of each company's cust omers, s uppliers, employees or other bus iness pa rtners to the merger, (viii) the failure of the closing condit ions in the merger a greement to be satisfie d, or a ny unexpecte d delay in closing the me rger, (ix) the possibilit y t hat t he merger ma y be m ore e xpensive t o com plete than anticipate d, including as a result of unexpe cted factors or e vents, ( x) the dilut ion cause d by SouthState's issuance of a dditional s hares of its common st ock in the me rger, (xi) genera l com petitive, economic, political and market conditions, and (xii) other factors that may affect future results of At lantic Capital and SouthState including changes in asset quality and credit ris k; the inability to sustain re venue and earnings growth; changes in interest rates and ca pital markets; inflat ion; cust omer borrowing, re payment, investment and de posit pra ctices; t he im pact, extent and timing of technological changes; capital mana gement act ivities; and ot her actions of the Board of Gove rnors of the Fe deral Reserve S ystem and Off ice of t he Comptroller of t he Currency and legis lative and re gulat ory actions and reforms (5) risks relating to the continued im pact of the C ovid19 pandemic on t he compa ny, including possible im pact to the company and its employees from conta cting C ovid19, and to efficiencies and the control environment due to the continued work f rom home environment and t o our results of operat ions due to gove rnment stim ulus and ot her interventions to blunt the im pact of the pandemic; (6) t he impact of increasing digitization of the banking industry and movement of cust omers to on-line platforms, a nd t he possible impact on t he Bank's results of operat ions, customer base, expenses, suppliers a nd operations; (7) controls and proce dures risk, including the potent ial failure or circumvent ion of our controls and procedures or failure to com ply with re gulat ions related t o cont rols a nd procedures; (8) potential deterioration in real estate va lues; (9) the im pact of competition with other financial instit utions, including pricing pressures ( including t hose result ing f rom the CARES Act) and t he res ulting im pact, including as a result of compression to net interest margin; (10) risks relat ing t o the a bility t o retain our culture and att ract and reta in qua lifie d people; (11) cre dit risks associated wit h a n obligor's fa ilure t o meet the terms of a ny contract wit h t he ba nk or otherwise fail to perf orm as agreed under t he terms of any loan-relate d document; (12) risks relate d t o t he ability of the company t o purs ue its strate gic plans which de pend upon certain growth goals in our lines of business; (13) liquidity risk affecting the Bank's a bility t o meet its obligations when t hey come due; (14) ris ks associate d wit h a n ant icipated increase in Sout hState's investment securities portfolio, including risks associated w ith acquiring and holding investment securit ies or potentially determ ining that the amount of investment securities S outhS tate des ires t o a cquire a re not a vaila ble on terms acce ptable to SouthState; (15) price ris k focusing on cha nges in market factors that may affect the value of tra ded instrume nts in "mark-to-market " portfolios; (16) transact ion ris k arising from problems with service or product delivery; (17) compliance ris k involving ris k to earnings or capital resulting f rom violations of or nonconforma nce wit h laws, rules, re gulations, prescribe d practices, or et hica l standards; (18) re gulat ory change risk resulting f rom new laws, rules, regulations, accounting principles, proscribed practices or et hica l standards, including, without limitation, the possibilit y that regulatory agencies ma y re quire higher le vels of capita l

above the current re gulat ory-mandated m inim ums a nd including the im pact of t he CA RES Act, t he C onsumer Financial P rote ction Bureau re gulat ions, and the possibilit y of cha nges in accounting standards, policies, principles and pract ices,	including changes in
accounting principles relating to loan loss recognition (CECL); (19) strate gic ris k result ing from a dverse bus iness decisions or im proper implementation of bus iness decisions; (20) reputation ris k t hat adversely affects earnings or capital arising	from negative public

opinion; (21) cybersecurit y ris k related to t he de pende nce of Sout hState on internal computer systems and the technology of outside service providers, as well as the potentia l impacts of interna l or externa l securit y breaches, which may subject t he compa ny to potent ial business disruptions or financial losses result ing from deliberate attacks or uninte ntional e vents; (22) reputational and operational ris ks associated wit h environment, s ocial and governance matters; (23) greater t han expected noninterest e xpense s; (24) excessive loan losses; (25) potential deposit att rit ion, higher t han expecte d costs, cust omer loss and business disrupt ion associate d with the At lantic Capita l integration, and pote ntial diff iculties in maintaining relationships wit h key personnel; (26) the ris ks of f luctuat ions in market prices for S out hState comm on stock that may or may not reflect econom ic condition or performance of SouthState; (27) the pa yment of dividends on SouthState common st ock, which is subject t o legal and re gulat ory lim itations as well as t he discretion of the board of direct ors of SouthState, SouthState's perf ormance a nd ot her factors; (28) ownership dilution ris k ass ociate d wit h potential acquis itions in which SouthState's stock ma y be issued as considerat ion f or an acquire d com pany; (29) ope rational, t echnological, cult ural, regulat ory, le gal, credit and other ris ks associated with t he exploration, consummation and integration of potent ial fut ure a cquisition, whether involving st ock or cash cons iderat ion; (30) major catastrophes such as hurrica nes, tornados, earthquakes, floods or ot her natural or human disasters, including infectious disease outbreaks, including the ongoing Covid19 pa ndemic, and the related disruption to local, regiona l and global econom ic activit y and fina ncia l markets, and the im pact that any of the foregoing may have on SouthState and its cust omers and othe r constit uencies; (31) terrorist activit ies ris k that results in loss of cons umer confidence and economic disrupt ions; a nd (32) ot her fact ors that may affect f uture results of Sout hState, as disclosed in SouthStat e's Annual Report on Form 10-K, Qua rterly Reports on Form 10-Q, and C urrent Re ports on Form 8-K, file d by S outhState w ith t he U.S. Se curities and Exchange C ommission ( "SEC") and available on t he SEC's website at http://www.sec.gov, any of which could cause a ctual results t o differ materially from future results expressed, implied or otherwise anticipated by such forward-looking statements.

All f orward-looking statements s peak only as of the date the y are made a nd a re based on information a vailable at that t ime. S outhS tate does not unde rtake a ny obligation t o update or otherwise revise a ny forward-looking statements, whether as a result of new information, future events, or otherwise, except as required by federal securities laws. As forward-looking statements involve significant risks and uncertainties, caution should be exercised against placing undue reliance on such statements.

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SouthState Corporation

Overview of Franchise (1)

(281)

$42

Billion in assets

$24

Billion in loans

$35

Billion in deposits

$5.7

Billion market cap

#1 in Florida

#2 in Georgia

#3 in South Carolina

7 Greenwich Excellence Awards 2021

Top 50

Forbes 100 Best Banks in America 2021

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(1) Financial metrics as of December 31, 2021; market cap as of January 21, 2022; pending Atlantic Capital Bancshares, Inc. ("ACBI") merger excluded

D I V E R S I F I E D L I N E S O F B U S I N E S S

High-Growth Southeast Markets with National Line of Business Capabilities

Regional

•	Commercial Banking	•	Mortgage
•	Retail Banking	•	Wealth

1. • Business Banking
   • Treasury Management
2. Proforma basis, including pending ACBI merger

National

• Correspondent Banking & Capital Markets
• Payroll & Payments / Fintech (1)
• Corporate Billing / Factoring
• Association Prime (HOA)
• SBA

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S T R O N G P O P U L AT I O N G R O W T H T R E N D S

• SouthState is located in four of the top six states for highest population growth over the past year
• The four states highlighted below represent 93% of SouthState's total deposits

Top 10 States in Population Growth (July 2020 to July 2021)

			April 1, 2020			Population Growth
	Rank	State	(Estimates Base)	July 1, 2020	July 1, 2021	(actual)
	1	Texas	29,145,505	29,217,653	29,527,941	310,288
	2	Florida	21,538,187	21,569,932	21,781,128	211,196
	3	Arizona	7,151,502	7,177,986	7,276,316	98,330
	4	North Carolina	10,439,388	10,457,177	10,551,162	93,985
	5	Georgia	10,711,908	10,725,800	10,799,566	73,766
	6	South Carolina	5,118,425	5,130,729	5,190,705	59,976
	7	Utah	3,271,616	3,281,684	3,337,975	56,291
	8	Tennessee	6,910,840	6,920,119	6,975,218	55,099
	9	Idaho	1,839,106	1,847,772	1,900,923	53,151
	10	Nevada	3,104,614	3,114,071	3,143,991	29,920

Source: U.S. Census Bureau, December 2021

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